Bitcoin’s record surge above $90,000 fuels a rally in crypto-related stocks and mining operations, with shares of major companies like Coinbase and bitcoin miners posting double-digit gains.
Crypto-related stocks surged on Tuesday, fueled by bitcoin‘s (BTC) rally above $90,000, outperforming the broader stock market.
Bitcoin is a decentralized digital currency created in 2009 by an anonymous individual or group using the pseudonym Satoshi Nakamoto.
It operates independently of central banks and governments, relying on peer-to-peer transactions recorded on a public ledger called the blockchain.
Bitcoin's value is determined by supply and demand on cryptocurrency exchanges.
The first block in the bitcoin blockchain was mined on January 3, 2009, marking the birth of this digital currency.
Shares of major crypto companies like ‘Strategy‘ and Coinbase rose 8%-9%, while several crypto miners posted double-digit gains. Despite today’s bounce, U.S. mining operations face challenges from tariffs and potentially slowing growth.
Miners Lead the Way
Leading the move higher were bitcoin miners, with many of them posting double-digit gains, outpacing BTC‘s 5% advance. ‘Bitdeer Technologies (BTDR)’ rallied some 20%, while Bitfarms (BITF), CleanSpark (CLSK), Cipher Mining (CIFR), MARA Holdings (MARA), and Riot Platforms (RIOT) soared between 10% and 15% during the session.
Bitcoin miners are individuals or organizations that use powerful computers to solve complex mathematical equations, validating transactions and adding them to the blockchain.
This process is essential for maintaining the integrity and security of the Bitcoin network.
Miners are rewarded with newly minted Bitcoins for their efforts, which helps to secure the network and incentivize further investment in computing power.
Tariff Risks Loom Large
The bounce in mining stocks comes after months of underperformance, weighed down by compressed margins, rising hashrate competition, and tariff-induced difficulties. Most, if not all, publicly traded miners are still trading near multi-month lows. At issue for U.S.-based mining operations is the Trump administration’s tariff policy, which threatens to make ASICs (the machines used to mine bitcoin) much more expensive to import.
The Trump administration implemented several key policies during its tenure from 2017 to 2021.
One notable policy was tax reform, which aimed to reduce corporate and individual tax rates.
The administration also rolled back various regulations, particularly in the environmental and financial sectors.
Additionally, it pursued a hardline stance on immigration, including the construction of a border wall with Mexico.
Furthermore, Trump withdrew from several international agreements, such as the Paris Climate Accord and the Iran nuclear deal.
Implications for the Industry
The tariffs ‘will materially affect future spending and CapEx in the U.S.’ Taras Kulyk, co-founder and CEO of mining hardware provider Synteq Digital, told CoinDesk recently. ‘Other jurisdictions that had previously looked higher cost will become sought after targets for new infra and capex deployment.’ Canada, in particular, is likely to be a benefactor to the implementation of the global tariff regime.
Boost from Strategic Investments
One reason behind Bitdeer‘s outperformance may be its development of its own ASIC manufacturing business. The company recently took the decision to build out its self-mining capacities instead of selling its rigs in a slower market. ‘Stablecoin giant Tether has also been on a buying spree of BTDR shares, investing $32 million in the company as of last Thursday.’
Looking Ahead
Regardless of the outperformance today, tariffs will continue to play a key role in miners and most crypto-related stocks, along with other risk assets. With earnings season starting soon, all eyes will be on comments from CEOs about how the tariff situation will change the corporate outlook. Notably, Elon Musk‘s Tesla, which also holds bitcoin in its treasury, will report its earnings post-market on Tuesday, potentially providing some insight into how traders should price in trade war uncertainties.
